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21.03.2011
IBI-rating, Rurik, Expert-Rating misleading the market
After having obtained the status of authorized rating agency, IBI-rating, Rurik, and Expert-Rating managed to win by applying market practices a mere 5% of the market. The three perceive the Credit-Rating’s deprival of authorization as their first chance to anchor in the rating services market. In this connection the three take attempts of imposing information pressure by publishing untrustworthy information on Credit-Rating’s activities thus misleading consumers of rating services.
Leaving the public perplexed are the three’s attempts to interpret the rating-affecting legislation in their own way, and to determine legal framework of Credit-Rating’s activities. There are also used third organizations such as the Ukrainian Professional Association for Protection of Investors, Creditors and Insurants, which impartiality raises certain doubts. The participation of V. Shapran, who is the Expert-Rating’s officer, in the Council of the Association, should probably be deemed as a substantial makeweight to the opinion of this institution.
We are absolutely sure that participants of the financial market should be guided exclusively by direct norms of the effective legislation, and if necessary, by regulator’s official statements and interpretations regarding given segment of the financial services market.
The Credit-Rating’s determining ratings for banks and use of the banks’ ratings by insurers remains effective pursuant to the existing legislation. Specifically, Article 31 of the Law of Ukraine ‘On Insuring’ says that a credit rating assigned to a banking institution, with which insurance provisions are deposited, shall pertain to the investment grade of the National Rating Scale. This norm may also be found in acts of the State Commission for Regulation of Financial Services Market in Ukraine, which are registered in the Ministry of Justice, specifically in the Regulation on compulsory criteria and standards of sufficiency, diversification, and quality of assets representing insurance reserves for non-life insuring (Order 741 of 8.10.2009) and in the Regulation on placement of insurance reserves for life insuring (Order 2875 of 26.11.2004).
The resonant decision of the State Commission for Securities and Stock Market dated 15.03.2011 under #246 sets forth that after the decision came into force, Credit-Rating is eligible to perform independent rating assessment and assign ratings by the National Rating Scale, and to revise existing ratings except for the ratings which are mandatory according to the legislation.
We should note that the banks, along with the insurers, are not included in the full list of issuers, which are required to get a rating (the list is given in Article 41 of the Law of Ukraine ‘On State Regulation of Securities Market of Ukraine’). Both the banks and insurers have a right to conduct their activities bearing no ratings.
Thus, Credit-Rating has a full right to assign ratings to Ukrainian banks, and these ratings may be used by insurance companies in forming their insurance reserves in the full compliance with Article 31 of the Law of Ukraine ‘On Insuring’.
For more information, please contact:
Department of
Information and Communications
Sergey Rozumyak +38044490 25 50
SRozumyak@credit-rating.com.ua
Denis
Rudenko
